How does Urban Company Make Money? Urban Company Revenue Model.

#Update: UrbanClap is now know as Urban Company. However their business model remains the same.

UrbanClap is a online platform that allows users to hire service professionals for their day-to-day and homecare needs.

In this post, we discuss how UrbanClap makes money from the business of connecting users with service professionals.

But, first let us understand the company and its business a little better.

UrbanClap Founders:

UrbanClap was founded by the team of Abhiraj Bhal, Raghav Chandra and Varun Khaitan.

UrbanClap Business Model:

UrbanClap is an online matketplace which connects service professionals from customers.

Customers use the platform to find and hire processionals for a wide range of services. This could include home-service professionals like electricians or plumbers; repair technicians for home appliances; a fashion photographer or a beautician.

UrbanClap Revenue Model:

Now, that we have an understanding of what the business offers, we can attempt to understand the revenue model of Urbanclap.

As alluded to above, users use the UrbanClap platform to hire a wide variety of service providers.

And, the revenue which the UrbanClap platform earns depends upon the types of services on offer.

Let us assume that you wish to use the platform to hire a plumber to replace a leaking tap. Let’s say that their are 10 registered professionals on the platform who can do the job for you.

As long as the job is done right, you remain indifferent as to which of the professional performs the job. Here we are talking about more generic services.

Next we come to more specialised services.

Now, let us assume that you wish to hire a photographer for your pre-wedding photoshoot.

Since, the service involves a substantial cost and you want the photographs to turn out just right, you would want to have quotes from multiple photographers, verify their credentials before handing the contract to the person you deem the most fit within your budget.

Note that the nature of service, specialised or generic, determines how Urbanclap makes money.

UrbanClap makes money in the following ways:

Commission based Model for Generic Services:

For generic services like the hiring of a plumber or an electrician, UrbanClap works on a commission based model.

Here, UrbanClap connects a suitable service professional directly with the customer, and makes money by charging the service professional a fee/commission based on the value of the services being provided.

Note that under this model, the fee that the professional charges is often controlled by the platform.

Lead Generation based Model for Specialised Services:

For more specialised services like those provided by a photographer or a dietitian, UrbanClap operates on a lead generation model.

Here the platform focuses on generating leads for the service providers with the final choice of hiring the professional remaining with the customer.

This is how it works:

When a user enquires about a certain service on the platform, the relevant service providers get a notification from the platform with the details of services being sought for.

Now, if a service provider considers the lead to be relevant, he/she has to pay a fee to the UrbanClap platform to access the customer’s contact details and thus make an offer.

Here, the platform plays no part in deciding the fees and other technicalities of the services on offer and this is mutually decided upon by customer and the service provider.

For specialised services, thus, UrbanClap makes money by generating leads for service providers inform of a lead-generation fee. The fee is payable irrespective of whether the lead finally converts or not.

Apart from making money through commissions and from lead generation, UrbanClap also makes money from advertising (at least its privacy page gives us some indication that it does).

Hope you have liked our presentation on the revenue model of UrbanClap. You might also be interested in understanding how CRED makes money?